(i) that Mr Slowey does not have a debt due to the Commonwealth under subsection 1223ABF(1) of the Social Security Act 1991; and

(ii) that the student start-up loan amount of $1,321 paid to Mr Slowey in March 2025 is instead a recoverable debt to the Commonwealth under Part 2AA.3 of that Act.

SOCIAL SECURITY - Youth Allowance - student start-up loan - overpayment - recovery of debt to the Commonwealth - no longer full-time student - 35 days after both qualification test day and course start day - point in time that debt should be recovered - Overpayments Determination - Scholarship Determination - enrolled in approved scholarship course at relevant date - no full-time requirement - debt not immediately recoverable - decision under review set aside

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted from this decision and replaced with generic information pursuant to subsection 201(1A) of the Social Security (Administration) Act 1999.

1. This review is about whether Mr Slowey has a student start-up loan debt that is immediately recoverable.
2. Mr Slowey, who is 21 years old, was granted youth allowance from 17 February 2025 on the basis that he was studying full-time at [University 1]. At that time, he was undertaking three units of study. On 9 March 2025 Services Australia (Centrelink) paid Mr Slowey a student start-up loan amount of $1,321 in addition to his youth allowance.
3. On 4 April 2025 Mr Slowey advised Centrelink that he had withdrawn from one of his units of study. On the same date Centrelink cancelled Mr Slowey's youth allowance on the basis that he was no longer a full-time student. On 28 April 2025 Centrelink also raised a debt of $1,321 against Mr Slowey to recover the student start-up loan paid to him.
4. Mr Slowey requested a review and on 19 June 2025 an authorised review officer affirmed Centrelink's decision. In doing so, the authorised review officer found that Mr Slowey was not entitled to the student start-up loan paid to him in March 2025 because he did not continue with full-time study for 35 days after his qualification test day of 9 March 2025.
5. Mr Slowey applied to the Tribunal on 19 June 2025. The application was heard on 26 September 2025, with Mr Slowey appearing by telephone. After subsequently obtaining written submissions from Centrelink, the Tribunal made its decision.

Is there an immediately recoverable debt to the Commonwealth?

1. Mr Slowey told the Tribunal that he was originally undertaking three units of study in Trimester 1 of this year, commencing on 17 February 2025. He then dropped one of these units on 4 April 2025, which reduced his study load to part-time. The university instructed him to notify Centrelink about this change and, when he did so, he was told that he had a debt of the student start-up loan that had to be repaid immediately. He disagrees with this decision because he was a full-time student for more than 35 days after his course began. As such, the student start-up loan he was paid in March 2025 should be recovered at a later date in the usual way, not as a debt with Centrelink.
2. When asked about his current circumstances, Mr Slowey told the Tribunal that he is still studying and that he lives at home with his family. He does not have a job and is dependent on his family for financial support. He is not disputing that he is obliged to repay his student start-up loan, only the point in time at which this recovery should occur.
3. In support of his contention that Centrelink's decision was incorrect, Mr Slowey provided the Tribunal with additional documentation prior to the hearing. This material included a copy of his student identification card for 2025 and his unit details for Trimester 1.
4. In making its decision, the Tribunal must apply the law in the Social Security Act 1991 (the Act) and related Ministerial determinations. A student start-up loan is a Commonwealth-funded loan that is payable to eligible students under Part 2AA of the Act. Under subsection 1061ZVBB(1), a person who receives youth allowance is qualified for a student start-up loan in the following circumstances:

(1) A person is qualified for a student start-up loan for a qualification period if:

(a) on the person's qualification test day for the period:

(i) the person is qualified for youth allowance and youth allowance is payable to the person; and

(ii) the person is receiving youth allowance and would be receiving youth allowance if steps 2 and 3 of the method statement in point 1067G-A1 of the Youth Allowance Rate Calculator were disregarded for the purposes of working out the person's rate of that allowance; and

(iii) the person is qualified for youth allowance under section 540 in circumstances where subparagraph 540(1)(a)(i) (about full-time study) applies and the relevant course of education is an approved scholarship course ...

Note 2: The person might incur a debt if the condition in subparagraph (a)(iii) is no longer met in a certain period starting on the qualification test day: see subsection 1223ABF(1).

1. When a person has been paid an amount of student start-up loan, they incur a debt to the Commonwealth that will normally be recovered through the taxation system when the person's income exceeds the statutory repayment threshold - see section 1061ZVDA and related provisions in Part 2AA.3 of the Act. However, under section 1223ABF, a debt is immediately recoverable in the following circumstances:

(a) a person is paid a student start-up loan for a qualification period; and

(b) the circumstances determined under subsection (2) apply to the person;

(c) the amount of the loan is a debt due to the Commonwealth; and

(d) the debt is taken to have arisen when the person was paid the loan.

(2) The Minister may, by legislative instrument, determine circumstances in which subsection (1) applies to a person who has not met, or who has ceased to meet, the condition in subparagraph 1061ZVBB(1)(a)(iii) or (2)(a)(iii).

(3) Subsection (1) does not apply to a person if, in the Secretary's opinion, the person did not meet, or ceased to meet, the condition in subparagraph 1061ZVBB(1)(a)(iii) or (2)(a)(iii) because of exceptional circumstances beyond the person's control.

1. With regard to subsection 1223ABF(2), the Minister has determined, in subsection 5(1) of the Student Start-up Loan Debts and ABSTUDY Student Start-up Loan Overpayments Determination 2016 (the Overpayments Determination), that:

... subsection 1223ABF(1) of the Social Security Act applies to a person if the person is not enrolled in an approved scholarship course at the end of 35 days after the later of:

(a) the person's qualification test day for a qualification period; and

(b) the person's course start day in a qualification period.

1. Under subsection 592M(1) of the Act, an approved scholarship course is a course determined to be such by the Minister. Under section 6 of the Social Security (Approved Scholarship Courses) Determination 2020 (the Scholarship Determination), the Minister has determined that an approved scholarship course includes an accredited higher education course provided by a higher education institution.
2. In Mr Slowey's case, it is not in dispute that he has a debt to the Commonwealth as the result of the payment of student start-up loan in March 2025 and that this debt must be repaid. The sole matter of contention is the point in time that this debt should be recovered. This turns on whether an immediately recoverable debt exists under subsection 1223ABF(1) of the Act. If not, then the student start-up loan paid to Mr Slowey in March 2025 will be recoverable at a later date under Part 2AA.3 of the Act.
3. In determining this matter, the Tribunal notes that it is uncontested that Mr Slowey was qualified for youth allowance, and that youth allowance was payable to him, on 9 March 2025, the relevant qualification test day for a student start-up loan. Although a student start-up loan amount of $1,321 was duly paid, Centrelink has since decided that a debt exists under subsection 1223ABF(1) of the Act on the grounds that Mr Slowey ceased to be a full-time student within 35 days of 9 March 2025. While Mr Slowey highlighted at the hearing that he ceased to be a full-time student more than 35 days after his course start day of 17 February 2025, the Tribunal is mindful that the Overpayments Determination specifies that the relevant timeframe is 35 days after the later of a person's qualification test day or course start day. As Mr Slowey's qualification test day of 9 March 2025 is later than his course start day of 17 February 2025, the relevant question is whether the circumstances in which a debt arises under subsection 1223ABF(1) applied to him 35 days after 9 March 2025.
4. On this issue, the Tribunal observes that Mr Slowey would clearly come within the circumstances set out in subsection 5(1) of the Overpayments Determination if he had withdrawn from his course completely on 4 April 2025. However, Mr Slowey remained enrolled in two units after withdrawing from one unit on this date. This raises the question whether subsection 5(1) of the Overpayments Determination applies to a person who remains enrolled in their course as a part-time student.
5. In concluding that this is the case, Centrelink has made a decision consistent with Australian government policy guidelines set out in the Social Security Guide (the Guide). In particular, the Guide, at topic 6.3.8.40, paraphrases subsection 5(1) of the Overpayments Determination as follows (with the Tribunal's emphasis):

• they are not enrolled in an approved scholarship course on a full-time basis 35 days after their qualification test day or course start date for a qualification period, whichever is later ...

While the Guide specifies that a person must be enrolled in an approved scholarship course on a full-time basis, subsection 5(1) of the Overpayments Determination states that the circumstances for a debt under subsection 1223ABF(1) will arise if a person "is not enrolled in an approved scholarship course". Given the apparent conflict between the Guide and the Overpayments Determination, the Tribunal directed after the hearing that Centrelink provides written submissions to clarify the legal basis for its decision.

1. In these submissions, Centrelink contended that Mr Slowey's circumstances came within subsection 5(1) of the Overpayments Determination because he was not enrolled on a full-time basis at the end of 35 days after his qualification test day of 9 March 2025. With regard to the legal basis for raising a debt, Centrelink submitted as follows:

Subparagraph 1223ABF(2) of the Act provides the circumstances for a Student Start-up Loan paid to become a debt:

"The Minister may, by legislative instrument, determine circumstances in which subsection (1) applies to a person who has not met, or who has ceased to meet, the condition in subparagraph 1061ZVBB(1)(a)(iii) or (2)(a)(iii)."

The condition referred to in subparagraph 1061ZVBB(1)(a)(iii) of the Act, in relation to a person receiving Youth Allowance is:

"the person is qualified for youth allowance under section 540 in circumstances where subparagraph 540(1)(a)(i) (about full-time study) applies and the relevant course of education is an approved scholarship course"

Subparagraph 540(1)(a)(i) of the Act provides that the person is qualified for Youth Allowance in respect of a period if the person is undertaking full-time study throughout the period.

Therefore, the debt provision, subparagraph 1223ABF(2) of the Act, provides for the legislative instrument (the Determination) in the context of the person "undertaking full-time study".

"Subject to subsections (2) and (3), subsection 1223ABF(1) of the Social Security Act applies to a person if the person is not enrolled in an approved scholarship course at the end of 35 days after the later of:

(a) the person's qualification test day for a qualification period; and

(b) the person's course start day in a qualification period."

1. As articulated by Centrelink, the need for a person to be a full-time student derives from subsection 1223ABF(2) of the Act, which provides that the Minister may determine circumstances in which a debt arises under subsection 1223ABF(1) for a person who has ceased to be a full-time student for the purpose of subparagraph 540(1)(a)(i). While the Tribunal accepts that subsection 1223ABF(2) applies to a person who becomes a part-time student, this change in study status does not of itself give rise to a debt under subsection 1223ABF(1). Rather, as indicated by the wording of subsection 1223ABF(2), the circumstances in which a debt arises for a part-time student under subsection 1223ABF(1) of the Act are those specified by the Minister. As set out in subsection 5(1) of the Overpayments Determination, those circumstances are that the person is not enrolled in an approved scholarship course at the relevant date. As defined in the Scholarship Determination, such a course includes an accredited university course. As far as the Tribunal can discern, there is no requirement under either the Overpayments Determination or the Scholarship Determination for the course in question to be a full-time course.
2. While mindful that the Guide states otherwise, the Tribunal must apply the legislation itself. In the view of the Tribunal, the legal position as set out by section 1223ABF of the Act and the related Ministerial Determinations is that a person will have an immediately recoverable debt if they are not a full-time student at the relevant point in time and they are not enrolled in an approved course. In Mr Slowey's case, he became a part-time student on 4 April 2025 but was still enrolled in his degree at [University 1], which was an approved scholarship course, at the end of the 35 days after both his qualification test day and his course start day. This being so, the Tribunal finds that the circumstances determined under subsection 1223ABF(2) of the Act do not apply to Mr Slowey, notwithstanding the fact that he had become a part-time student.
3. The Tribunal therefore concludes that Mr Slowey does not have a debt to the Commonwealth that is immediately recoverable under subsection 1223ABF(1) of the Act. The Tribunal instead finds that the $1,321 in student start-up loan that was paid to Mr Slowey in March 2025 is a debt to the Commonwealth that is recoverable at a later point in time under the provisions in Part 2AA.3 of the Act.

The Tribunal sets aside the decision under review and in substitution decides as follows:

(i) that Mr Slowey does not have a debt due to the Commonwealth under subsection 1223ABF(1) of the Social Security Act 1991; and

(ii) that the student start-up loan amount of $1,321 paid to Mr Slowey in March 2025 is instead a recoverable debt to the Commonwealth under Part 2AA.3 of that Act.